THE company of Malaysian tycoon T Ananda Krishnan (in pic) is poised to lose a total of about $7 billion from a failed 12-year foray in the Indian wireless market, marking his biggest hit on a soured investment, people with knowledge of the matter said.

Krishnan-backed mobile carrier Aircel filed to start insolvency proceedings in India, the company said on Wednesday. Maxis Communications, a holding company for some of Krishnan’s telecom ventures, has made about $3.4 billion of shareholder advances to Aircel that it now won’t be able to recoup, according to one of the people.

Over the years, Maxis Communications also injected around $1.2 billion into Aircel in return for common stock and subscribed to $1.6 billion of redeemable preference shares, the person said, asking not to be identified because the information is private. Both classes of securities are expected to be wiped out in the insolvency proceedings, according to the people.

The estimated losses also include about $800 million that Krishnan spent when he first bought the business in 2006.

Krishnan has no bank borrowings related to the Aircel investments, one of the people said. While Maxis Communications currently doesn’t expect to recoup funds from any potential selloff of Aircel’s assets, the insolvency process is at an early stage and the situation could change, the people said.

Maxis Communications is 45 per cent controlled by Krishnan through his private investment vehicle Usaha Tegas. Saudi Telecom Co owns a 25 per cent interest, while 30 per cent is held by so-called bumiputera, or ethnic Malay investors.

Saudi Telecom has no financial exposure nor obligations to Aircel after amending the shareholder agreements relating to the Indian carrier in December 2013, a representative for the Saudi company said.

Krishnan, 79, is Malaysia’s third-richest man with an estimated net worth of $6.1 billion, according to the Bloomberg Billionaires Index. He controls stakes in Maxis Bhd, the Southeast Asian nation’s biggest mobile carrier by subscribers, as well as pay-TV operator Astro Malaysia Holdings Bhd and oil services provider Bumi Armada Bhd. The tycoon also has interests in properties in the U K and Switzerland.